A pharmacy system protected from price competition is a Finnish oddity. If implemented correctly, opening the industry to competition would benefit the poorest, but the politicians have not had the will to do so.
I rememberwhen exactly did I internalize the strangeness of the Finnish pharmacy system.
It's been years. I was walking in southern Helsinki when I noticed a note on the door of Liiketila. It said that there was supposed to be a pharmacy here, but the safety and development center for the pharmaceutical industry, Fimea, felt that there was no need for it.
The reason: there was already a pharmacy a few hundred meters away.
Consumers' Association published a survey in March, according to which almost one in five has to save on medical expenses. The figure had risen by five percentage points from a couple of years ago.
In Finland, we believe in rational medical treatment. It also includes the fact that no one should have to compromise on medicines for money.
In principle, income support should ensure that this does not happen. There are still indications of drug poverty, other than the survey by the Finnish Consumer Union.
in Fimea's drug barometer in 2021 more than one in four respondents saidthat the medicines are too expensive for them.
The issue has also come up for discussion in connection with scabies. Finns have bought scabies medicines from abroad because they are so expensive in Finland. This is mainly due to a reason that pharmacies cannot influence: scabies medicines are not Kela-reimbursable, which means that pharmaceutical companies can price the wholesale price freely. Pharmacies could lower the price of over-the-counter medicines if they wanted to.
Pharmacist at the pharmacy in Hus Kirsi Kvarnström has dealt with it in his recent dissertation, why people don't use medicines as directed. According to Kvarnström, one reason is that if there is little money, it is first used for food and rent and only then for medicine.
Medicines the price is linked to the pharmacy system. The Finnish Competition and Consumer Authority (KKV) by both the profit of pharmacies and the income of pharmacists have “repeatedly been found to be relatively large, which is reflected in the drug costs of consumers and society”.
Fimea grants pharmacy licenses on a discretionary basis based on the availability of medicines. Those who have a license can be considered lucky, because many pharmacists are very wealthy. Revenues are increased by companies founded in connection with pharmacies, which sell, for example, cosmetics under the pharmacy brand.
If Fimea decides to grant a new pharmacy license, a pharmacist already operating in the area can appeal the decision and block the entry of a competitor at least for a while.
Even if there were several pharmacies in the same area, price competition does not seem to arise. As a rule, the price of medicines is precisely regulated by the medicine tax. In self-medication, price competition would be possible to some extent, but Iltalehten according to the report that doesn't happen either. In almost all the medicines reviewed by the magazine, the prices were the most expensive possible.
Finn the system protects wealthy pharmacists especially at the expense of low-income Finns.
No party has really wanted to open the sector to competition. It's pointless to talk about party conference decisions or different outcomes, if practically nothing is done about it when in power.
The government is to some extent liberalizing, for example, the sale of over-the-counter medicines and online shopping. The measures fall far short of what KKV presented in an extensive survey in 2020: dismantling the current pharmacy license process, location and quantity regulation, price regulation and company forms.
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The system protects wealthy pharmacists.
Left-wing parties oppose the opening of the pharmacy sector, apparently because the idea of expanding market forces seems wrong. The situation is rather grim: the parties that rhetorically side with the little person oppose a reform that would reduce medical poverty at the expense of a very wealthy professional group.
The attitude of the right wing is equally contradictory. The coalition considers itself a market economy party, but in this matter it is a pro-business party that specifically favors pharmacists. There are influential politicians in the party who understand the interests of the pharmacy industry very well.
In many matters, Finland looks to the Nordic countries, but not in the regulation of the pharmacy sector. In Finland, according to the Ministry of Social Affairs and Health, the margin for pharmacies has already been the highest in the Nordic countries for the cheapest medicines.
In Denmark and Norway, over-the-counter medicines were released for sale outside pharmacies in the early 2000s. In Sweden, the sector was liberalized in 2009. The number of pharmacies in remote areas of Sweden did not collapse, the prices of medicines have fallen and the vast majority of people still buy their medicines from pharmacies. Certain products, such as paracetamol, have been returned to pharmacy sales only due to the increase in drug poisonings. However, the effect of the pharmacy reform on poisonings is unclear.
It is not at all meaningful to think that you should be able to buy anything at the cash register of a store. More important is who can own the pharmacy and whether there will be price competition between the pharmacies. For some reason, anyone can own a hospital (or pharmaceutical company or drug wholesaler), as long as the doctor is responsible for patient safety. But the owner of the pharmacy must be a pharmacist.
A similar protected professional group cannot be found anywhere else. And opening ownership does not mean compromising safety, as has been seen with hospitals. It should be a condition of the pharmacy license that the pharmacist is always responsible for patient safety regarding prescription drugs.
Anyone does not want taxi reform in the pharmacy sector. One that has a good starting point, but is run through too quickly and with insufficient information. Pharmacy reform is complicated and challenging. It has to be done carefully, in the right order and specifically as a whole.
More information is still needed. For example, a support mechanism must be planned to prevent pharmacies from disappearing in remote areas. You have to think about the right level of support. It is necessary to find out which pharmacies are central in terms of drug availability. Among other things, these issues are currently being investigated at KKV, the State Economic Research Center (Vatt) and Aalto University. In addition, care must be taken that when retail prices fall, pharmaceutical companies do not raise their own prices.
It's difficult, but doable.
At the beginning of the year, the medicine ceiling went up. At the same time, the government is implementing very large cuts to social security. Next year, the value added tax on medicines will increase.
Would it finally be time to reform the pharmacy system in a better direction for the consumer?
The author is a journalist at Helsingin Sanomat.
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